A project under consideration has an internal rate of return of 13% and a beta of...

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Finance

A project under consideration has an internal rate of return of13% and a beta of 0.4. The risk-free rate is 3%, and the expectedrate of return on the market portfolio is 13%.


a. What is the required rate of return on theproject? (Do not round intermediate calculations. Enteryour answer as a whole percent.)


b. Should the project be accepted?

  • Yes

  • No


c. What is the required rate of return on theproject if its beta is 1.50? (Do not round intermediatecalculations. Enter your answer as a whole percent.)


d. Should the project be accepted?

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4.2 Ratings (680 Votes)
Information providedInternal rate of return 13Beta 04Risk free rate 3Expected return on the market portfolio 13aThe required return on the    See Answer
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A project under consideration has an internal rate of return of13% and a beta of 0.4. The risk-free rate is 3%, and the expectedrate of return on the market portfolio is 13%.a. What is the required rate of return on theproject? (Do not round intermediate calculations. Enteryour answer as a whole percent.)b. Should the project be accepted?YesNoc. What is the required rate of return on theproject if its beta is 1.50? (Do not round intermediatecalculations. Enter your answer as a whole percent.)d. Should the project be accepted?

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